Given the Russian cash funding the Tory party.....

youtu.be/AdDJu0Wqb2k

this explains things quite well about Russian money, London and the Conservative Party.

?

Carole Cadwalladr

The news from Kiev is so ominous tonight. But I keep coming back to this. Boris Johnson’s govt is complicit. It took the dodgy donations. It enabled the laundering of the cash. It shelters the Kremlin elite, and it failed, failed, failed to investigate.

As said before, I think they have enough photos and videos to blackmail him to Kingdom come and way beyond!

“There’s renewed concern [among Tory MPs] about what [Johnson] might have seen and done during as many as half a dozen visits to Lebedev’s Italian villa near Perugia, sometimes flying in the host’s private jet.”

The New Statesman.

MaizieD

Germanshepherdsmum

My shares were purchased for income and capital growth. Without the incentive of low income tax on dividends I would definitely have invested elsewhere. With share purchase comes considerable risk. You have to have a reward for taking that risk or why bother?

Where else would you invest, then?

Do you only invest in new shares?

Because anything else is pure speculation and doesn't deserve 'incentives'. Because the money isn't going to the companies, it's just going to another speculator.

My shares were all bought as new shares.

Dinahmo

GSM Gold, fine wines etc aren't going to pay the bills until you sell them. So, do you starve, or restrict your pleasures because your investments are growing in value.

I have other income Dinahmo. Property can provide an income, taxed at a higher rate than dividends at present of course, as well as hopefully capital growth; the other items I mentioned (in which I haven't invested) capital growth only (though the wine might be difficult to keep!).

Kali2

If all the billions of dirty money leave the UK- what will be the effect on the financial markets, and the UK in particular?

On exchange rates, and so much more.

What about the billions hidden in luxury apartments etc, in London and elsewhere?

So much of it has gone into Tory coffers that the average person will probably not notice the difference other than the price of houses coming down in some parts of London.

It's just another aspect of this Dirty Parliament. Heaven knows what will be uncovered when they go.

Kali2

If all the billions of dirty money leave the UK- what will be the effect on the financial markets, and the UK in particular?

On exchange rates, and so much more.

What about the billions hidden in luxury apartments etc, in London and elsewhere?

I wouldn't worry about it, Kali2, it isn't going to happen.

Germanshepherdsmum

My shares were purchased for income and capital growth. Without the incentive of low income tax on dividends I would definitely have invested elsewhere. With share purchase comes considerable risk. You have to have a reward for taking that risk or why bother?

Where else would you invest, then?

Do you only invest in new shares?

Because anything else is pure speculation and doesn't deserve 'incentives'. Because the money isn't going to the companies, it's just going to another speculator.

If all the billions of dirty money leave the UK- what will be the effect on the financial markets, and the UK in particular?

On exchange rates, and so much more.

What about the billions hidden in luxury apartments etc, in London and elsewhere?

Germanshepherdsmum

Quite a few choices if the income on all the investments is going to be taxed at the same rate. Maybe buy property, maybe invest in gold or fine wine if you’re seeking capital growth rather than income … it will all take away investment in the company, for which there has to be an incentive.

That wouldn't work. Earnings/income from all sources would be counted as income and be part of the same tax structure - adding it all together. Also, all allowances would be the same. There is no ethical reason for the difference; it just leads to the gap between rich and poor getting wider. When you sell the items that only or also earn capital growth, the tax would be the same as on all capital gains. That might even make it possible to have a lower tax rate when buying a house. Again it could help even up the gap which has grown even wider over the last 10 years.

If it did lead to a different bias in investments, surely that is just the unfettered marketplace working. Very Johnsonian Conservatism.

GSM Gold, fine wines etc aren't going to pay the bills until you sell them. So, do you starve, or restrict your pleasures because your investments are growing in value.

???

My last reply to Germanshepherdsmum Wed 23-Feb-22 16:02:56.

My shares were purchased for income and capital growth. Without the incentive of low income tax on dividends I would definitely have invested elsewhere. With share purchase comes considerable risk. You have to have a reward for taking that risk or why bother?

Mind you, I'm talking from a position of some ignorance...

Nobody GSM? We better go back to slavery then. They would make even more profit off the backs of others that way. If fact I am sure that was the same argument used for not abolishing it.

Germanshepherdsmum

Quite a few choices if the income on all the investments is going to be taxed at the same rate. Maybe buy property, maybe invest in gold or fine wine if you’re seeking capital growth rather than income … it will all take away investment in the company, for which there has to be an incentive.

Property rents should be taxed at the same rate as income. There's no coherent reason why it shouldn't be. 'Investment' in art, gold, fine wines etc. doesn't bring in an income at all, just the possibility that it might there might be an increase in value when it comes to selling such assets. So we can leave them out of the taxation equation, can't we.

Frankly I don't believe that people will stop investing in shares just because they have to pay more tax on the dividends. It's like the 'capital flight' myth. They will always have the prospect of selling their shares at a profit, possibly a very handsome one, if the company is successful...

And I believe that there are other methods of capitalising new businesses... I doubt if many go directly to the stock market

www.pczone.co.uk/5-ways-to-fund-your-new-business-project/

realbusiness.co.uk/the-pros-and-cons-of-listing-your-business-on-the-stock-market

Quite a few choices if the income on all the investments is going to be taxed at the same rate. Maybe buy property, maybe invest in gold or fine wine if you’re seeking capital growth rather than income … it will all take away investment in the company, for which there has to be an incentive.

Germanshepherdsmum

So, Daisy, a company wants to raise money by issuing shares. Nobody wants to buy them as income on dividends will be taxed at the same rate as the rest of their income. Solution?

What else will they do with their capital?

I've gone slightly off topic here but this in response to the various comments about taxation.

Many thousands of people who aren't in employment live off the proceeds of their investments, whether it's rented property or stocks and shares. If you are experienced in buying and selling stocks and shares you earn up to £24870 tax free each year, ie just under £50,000 per couple. That is by utilising the annual CGT exemption of £12300 plus the current year personal allowance of £12570. The only thing to stop you is if HMRC decide that you are carrying on an adventure in the nature of trade. This last applies to share dealing.

Compare this to an employee on a salary of £24870 who would pay income tax of £2514 and NIC of £1836 making a total of £4350 deducted.

If you then take into account the fact that the employee is likely to be paying rent or a mortgage whereas the investor has probably paid for their house you can see the iniquities in the present system.

We are living longer, even if retiring after our anticipated retirement ages, we do need to contribute more in tax/NIC than many of us do at present.

So, Daisy, a company wants to raise money by issuing shares. Nobody wants to buy them as income on dividends will be taxed at the same rate as the rest of their income. Solution?

Germanshepherdsmum

The initial investment is vital to the company Daisy. So dividends are taxed at a lower rate. The shareholder will pay CGT on any uplift in value when they sell.

I'm aware some companies see a need to raise capital GSM, and how they do it. However, that was not what I started out discussing; you brought it in to make an argument that wouldn't hold water where income is concerned. I was very clearly talking about an all-encompassing income tax. This tax would include all forms of "income" added together and treated as we currently treat what is often called "earned" income.

MaizieD

Here's some notes about the incentives (tax reliefs) available for start ups.

Many entrepreneurs will be concerned with their own tax affairs when launching their startups, but if they are looking to attract outside finance they may also want to consider the tax position of their prospective investors so they are able to offer a better investment proposition.

Two UK government-backed schemes in particular offer tax reliefs for investors: the seed enterprise investment scheme (SEIS) and the enterprise investment scheme (EIS).

An external shareholder in a small startup under the SEIS will get 50% income tax relief on the amount they pay to subscribe for qualifying shares, according to Peter Tucker, partner at Dickinsons Chartered Accountants. “And if they hold those shares for at least three years, any capital gain on their subsequent disposal is tax free.”

Under the EIS, which applies to slightly larger companies, investors could enjoy a tax rebate of 30%. “That's still quite generous,” Tucker says. “And both of the schemes could also be used to shelter other capital gains.”

The initial investment is vital to the company Daisy. So dividends are taxed at a lower rate. The shareholder will pay CGT on any uplift in value when they sell.